MLI - The OECD releases guidance on Synthesised texts for providing clarity on the impact of the MLI

On November 14, 2018 the OECD released new Guidance for the development of synthesised texts (Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI)). On the same date also a Secretariat note was released. This Secretariat note clarifies the entry into effect rules for tax treaties of jurisdictions that deposited their ratification instruments in September 2018.

Guidance for the development of synthesised texts

This Guidance has been prepared by the OECD to provide suggestions to Parties to the MLI for the development of documents they could produce to help users of the MLI to understand its effects on tax agreements it covers and modifies (the “Covered Tax Agreements”). The objective is to present in a single document and for each covered tax agreement: the text of a Covered Tax Agreement, including the text of relevant amending instruments; the elements of the MLI that have an effect on the Covered Tax Agreement as a result of the interaction of the MLI positions of its Contracting Jurisdictions; and information on the dates on which the provisions of the MLI have effect in each Contracting Jurisdiction for the Covered Tax Agreement. Such documents would be referred to as “synthesised texts”.

In the Guidance for the development of synthesised texts a.o. the following subjects are being discussed:

§Article 35(5) – Entry into effect resulting from an extension of the list of agreements notified

§Article 35(7) – Completion of internal procedures

The Guidance furthermore contains an Annex containing an example of the Synthesised Text of the 2014 OECD Model Tax Convention as modified by the Multilateral Instrument.

Click here to be forwarded to the Guidance for the development of synthesised texts as released by the OECD on November 14, 2018.

Secretariat note

This note seeks to clarify the interpretation and application of Article 35 of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (the MLI) on the entry into effect of the provisions of the MLI.

Click here to be forwarded to the Secretariat note as released by the OECD on November 14, 2018.